Lenovo's new enterprise division introduces its first server

Lenovo's Enterprise Product Group will deal in servers, networking and storage products

By Agam Shah

November 6, 2012

IDG News Service

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Looking beyond PCs and tablets, Lenovo on Monday announced the first server from the newly formed Enterprise Product Group, which deals in servers, storage, networking and software.

The ThinkServer TD330 is a tower server based on Intel's Xeon E5-2400 processors. The server will support up to 16 processor cores and start at US$929.

Lenovo last week announced the formation of the Enterprise Product Group. It is headed by Roy Guillen, vice president and general manager of the division. Guillen was previously vice president and general manager of Dell's data center solutions (DCS) division.

Lenovo already offers low-end servers and workstations for homes and small businesses, but the new division will target small, medium-size and large enterprises. Lenovo has offered low-end servers based on Intel's Xeon E3 and E5 processors, but the company did not respond to a request for comment on whether existing ThinkServer products would be part of the enterprise product portfolio.

"We've placed expanded emphasis on building our server portfolio this year, introducing products that meet the needs of all our customers -- from enterprise customers to small businesses," Guillen said in a statement.

Lenovo established itself as a PC company after it bought IBM's PC division in 2005. Lenovo's progress in the PC market has been rapid, with IDC placing the company as the world's largest PC vendor for the first time in the third quarter this year. The new enterprise division will put Lenovo in competition with IBM, Hewlett-Packard and Dell, which also sell x86 servers.

While the PC business will remain a mainstay for Lenovo, the company is following the footsteps of Hewlett-Packard and Dell, which are focusing more on the high-margin data center hardware and servers, said Charles King, principal analyst at Pund-IT.

The new server is a small step ahead for Lenovo as it tries to establish itself in a market dominated by the heavyweights. The biggest challenge for Lenovo is to be seen as a vendor that enterprises can trust. Some existing PC products and enterprise partnerships will help, King said.

"The company's ThinkPad [laptop] still represents the gold standard in business laptops," King said. "That should open the door for business from enterprises that are Lenovo customers."

King recalled a similar partnership that EMC and Dell had for many years, until Dell formed its own storage integration stack through acquisitions like Equallogic and Compellent. Dell gained a lot of enterprise server business via the partnership with EMC, King said.

Lenovo is based in China, which represents the biggest enterprise opportunity, King said. A lot of enterprises in China would prefer dealing with Lenovo than other vendors, King said.